Handbook of Principles of Organizational Behavior - Soltanieh ...

SUSTAIN ORGANIZATIONAL PERFORMANCE THROUGH CONTINUOUS LEARNING 545
workers, and union leaders to transform Navigation Products, their business unit,
to a similar model of management, one that promised to improve coordination
across functions, build trust, and improve communication (Beer et al., 1990 ). In the
early 1980s the automobile companies sent managers by the hundreds to Japan to
learn about manufacturing methods that gave Japanese manufacturers a signifi cant
edge in quality, though in this instance what they learned failed to be translated into
change rapidly enough given the state of the automobile industry in 2008.
2. Develop a new compelling direction – strategy and values
Feedback and information is not enough. A new direction must be developed. To develop
this direction, change leaders orchestrate a series of discussions in their management team to
develop an understanding of what this information means for change in the company ’ s direction.
Exactly how successful is the organization being in its product or service offering? Why
is it not successful? How committed are people? How effective is the organization? What is
the implication for the future survival and success of the organization? What should be the
new objectives and strategy? What should be the guiding values of the organization? What
are the implied priorities? Discussing these questions in the light of the feedback and data to
which managers have been exposed can lead to a new understanding and sense of urgency.
Jerry Simpson, general manager of Navigation Products, held a series of meetings with
his top team that led them to defi ning new and ambitious goals for the business and a new
direction (Beer et al., 1990 ). A study of 25 business units undergoing change found that
units that had changed the most were more likely than lagging units to have established
a clear and broadly understood link between business problems and the need for change
(Beer et al., 1990 ). Making the link is what makes the new direction compelling to members
of the organization. It is quite important for leaders to involve the whole top team in
the formulation of the new objectives and strategy. And, it is important for that top team
to involve other key managers in discussing and critiquing their new strategy. This builds the
commitment needed to implement the new direction.
Moreover, the general manager or CEO can use the work of developing a new
direction to develop their top team ’s effectiveness. Research shows that effective strategy
formulation and implementation depends on top team effectiveness (Eisenhardt, 1989 ;
Beer and Eisenstat, 2000 ). Team effectiveness is developed through encouraging new
behavior, coaching, and if needed replacement of those key executives who do not play a
constructive role in the team and/or do not become committed to the new direction.
3. Identify organizational barriers to implementing the new direction
Often the resistance to change is at the highest levels of the company (Miller, 1990 ;
Finkelstein, 2003 ). Hierarchy insulates top management teams from the effects of their
behavior and policies. Exposing top management to feedback about what employees
perceive as barriers to implementing a new strategy further creates dissatisfaction and
identifies what changes in organization and behavior are needed to implement the new
strategy. John Scully began his belated and ultimately unsuccessful effort to change Apple
Computer after an attitude survey showed strong negative sentiments in the company
about the lack of strategic clarity and problems with top management ’s leadership.